Hong Kong stocks cap worst month since October on AI disruption angst
Concerns over AI’s disruptive impact on traditional industries continue to unsettle investors
For the month, the Hang Seng Index dropped 2.8 per cent, dragged down by Chinese technology stocks. The benchmark closed 1 per cent higher at 26,630.54 on Friday. The Hang Seng Tech Index gained 0.6 per cent, paring the decline in February to 10 per cent.
On the mainland, the CSI 300 Index slipped 0.3 per cent and the Shanghai Composite Index rose 0.4 per cent. The two gauges posted gains of 0.1 per cent and 1.1 per cent, respectively, this month.
The so-called AI scare trade has reverberated across global stocks over the past weeks, with investors wary that the technology could upend industries from logistics and software to wealth management by displacing their business models. Even strong earnings results from Nvidia did little to boost sentiment, as quarterly revenue fell short of Wall Street’s most bullish estimates.
Hong Kong stocks were more vulnerable to the turmoil because of the high weightings of service-related sectors that bore the brunt of the AI scare, according to Morgan Stanley.
“In addition, intensifying price competition among e-commerce platforms and still-lukewarm domestic consumption momentum have weighed on earnings revision prospects for large-cap platform companies,” said Laura Wang, a strategist at the US investment bank.